1.) A run on Yahoo's stock. Michael Arrington rightly points out that Yahoo's market cap increased from $26.2 billion to nearly $40 billion, primarily based upon the speculation that Microsoft would pay $31 per share to acquire the company. Those speculators will likely be furious, to put it mildly. Will Yahoo's stock price crater? Most likely, although the first few hours of Monday's trading session will likely tell the tale. Some have suggested that the stock price will crash down to about pre-merger-proposition levels, or about $19. My guess is that it bounces around like crazy and settles at about $22 to $24 -- people still have hope. But boy, are some people going to learn a harsh lesson about sure things.

1a.) Shareholder lawsuits. A no-brainer. Someone will pull the trigger.

2.) Yahoo ties up with Google on some search advertising. On this issue, the Magic 8 Ball seems murkier. Ballmer wanted to buy Yahoo's search team ( the "Panama" project) and if it outsources search to Google, that team may move onto other projects, Henry Blodget argues. Blodget argues persuasively that that's a good thing, as Yahoo can thus focus on areas where it can win. I'm a bit hard-pressed to tell the difference between AOL, (which outsourced its search) MSN, and Yahoo anyway; all three are portals trying to glom onto as much content as they can.

3.) A shareholder revolt, leading to a push to remove Jerry Yang, Yahoo's chief executive. Also a likely outcome. But is there a large enough contingent? On this, I have no idea.

4.) Microsoft's own "scorched earth" bid. Microsoft lets Yahoo's stock price plunge, and then returns to the table with a significantly lower bid. This is an intriguing possibility, but my gut says that when Ballmer walks away, he walks away for good.

If he does so, there are still a couple of favorable outcomes. First, Yahoo's Panama engineers know they have a job waiting for them in Redmond, and Microsoft could simply slowly aggregate the search talent it wants. Microsoft still has fundamental problems with its online strategy, namely the way it vomits content onto its MSN page.

A targeted search engine could also begin to refine that content somewhat, using historical searches and contextual information to present a more relevant page. That would also allow MSN to redesign itself in a cleaner, more Google-like image. (Compare the front page of Yahoo to MSN if you doubt me.)

Microsoft must define and deliver on a strategy that shows how they can "win" now without Yahoo! as a search jump start. (Frankly, we were skeptical that Microsoft could have integrated Yahoo quickly and effectively to realize the full value and vision of the acquisition). Rather than continue to chase Google's dominant search position, Microsoft should redefine the "battle" to one where search is an integrated part of the marketing mix. Microsoft has assets and relationships that GOOG doesn't have: 400 million users relationships through communication tools like Hotmail and Messenger, the aQuantive acquisition, strong display advertising business, and investments/relationships like Facebook. Moreover, AdCenter is well positioned to service advertisers on both the display and search sides, although actual offeringDeal is offs that tie the two together are still in the works. But the thing they don't have today is a strong search user experience, the root of the problem.

Second, I'm of the opinion that Microsoft needed Yahoo far more than Yahoo needed Microsoft, at least from a strategic perspective. But I'm still not convinced that bringing another portal into Microsoft's fold is in the best long-term interests of the company. I've never really found the value in social networking online, versus forging real-life connections (even via email); however, Microsoft might be better off investing in a smaller social-networking firm and start learning how this social stuff works. (Microsoft's research into social networking, SNARF, is tangential.)

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